We recently posted about the guilty plea by Glafira Rosales involving the forgeries sold through the Knoedler Gallery.  In a related civil action filed by art collectors, the federal court has recently denied a motion to dismiss the complaints and determined that most of the counts filed against the gallery and a former director, Ann Freedman, can move forward.

The outcome of the motion is not surprising, considering that, when determining a motion to dismiss, all of the allegations must be taken by the Court as if they were true.  And the complaint alleges many serious actions taken and misrepresentations made by the gallery and Freedman regarding the authenticity and provenance of the works in question.

For example, it is claimed that Freedman and the gallery were aware that forensic testing determined that certain paintings obtained by Rosales were forgeries, but that they decided to reject the expert’s conclusions and failed to disclose that information to potential purchasers.  For another work, it is alleged that Freedman and the gallery received a very negative report from the International Foundation for Art Research (IFAR), so the defendants decided to change their story about the origin of the work, and submitted no other works that they obtained from Rosales to IFAR.

The defendants continue to deny all of the allegations, so it will be interesting to see whether plaintiffs can provide any proof to these claims during discovery.  These defendants clearly offer a better chance than Rosales for a potential recovery, but plaintiffs will need strong support for their allegations of wrongdoing.

Please write to Mike Bono if you would like more information.